Exchange and Completion - A quick guide

But what happens next in order to finalise your purchase and really ‘seal the deal’? 

Here, we find out what's involved in ‘exchanging’ and ‘completing’ on your new home. 
 

What does it mean to 'exchange contracts'?

This is where the two legal organisations, each representing both the seller and the buyer, exchange (identical) signed contracts with each other. In short, until you've exchanged contracts, the purchase of your new abode is not guaranteed.  
 

The exchange of legal paperwork only occurs after all of the preliminary paperwork has been completed by both licensed conveying firms (or solicitors) - after steps such as carrying out local authority searches, conducting a property survey, obtaining a written mortgage offer, and confirming inventory items (‘fittings and contents’) have all been methodically worked through.  

Once the contracts are signed and exchanged, the arrangement becomes legally binding, and no one can ‘back out’ of the transaction. It’s therefore very important to use the time before you sign any paperwork wisely; checking and double-checking all the details before you go ahead and arrange to sign the contract.  

It’s your last chance to raise any concerns or questions you might have relating to, for example:  

- The current state of the property (perhaps arising from the survey) 
- Any planning or building history (extensions, a conservatory, etc) 
- Any conditions relating to the leasehold (if buying an apartment) 
- Anything emerging from the results of the local searches (flood risk, etc) 

Depending on the level of promptness exercised by all parties involved, and depending on how straightforward or complex the circumstances and conditions around the property sale are, the timescale of the whole process leading up to the point of exchange can be anywhere between a matter of weeks to many months. 
 

What happens after you ‘exchange’?

Soon after the exchange has taken place, you can set about getting a date for completion agreed - via your legal representatives. 

If you’re the buyer of the property, you should arrange for buildings insurance to go live from the date of the exchange of contracts. You should also make the necessary arrangements to transfer your deposit amount. 
 

What does it mean to ‘complete’?

If you’re the buyer, your completion date is the date when you are legally able to move into your new home and you take legal ownership of the property you’ve purchased. 
 

If everything runs smoothly, the estate agent will be waiting to hand the keys over to you so you can begin moving into your new abode. Also, on that date, your solicitor or licensed conveyancer will arrange to electronically transfer monies between the legal firms’ bank accounts - to the seller’s solicitor.  

If you’re the seller, it’s the date from which you will no longer own the deeds to the property, and also the same date where your legal representative will receive the money from the sale. 
Can anything go wrong before, or on the day of completion?  

Even with the most careful planning, you can come across potential obstacles if you’re unlucky. 

For example, if you happen to be part of a chain of buyers and sellers, and any of the party has to pull out suddenly, it can cause the whole process to suddenly grind to a halt. It may result in you having to take on the burden of extra costs and fees as a result. 

Another example would be if - when the money is being passed from your mortgage provider to your solicitors, to the buyer’s solicitors – it hasn’t landed in the right account by 3pm that day, everything pauses until the next working day, when the process of completing can resume again.  
 

How quickly can completion happen?

It’s common for completion to occur as soon as two to three weeks after the exchange of contracts, but it can depend on how many properties in total there are in ‘the chain’, and both yours and the other party’s circumstances.